Vertical Integration and Physician Practice Labor Composition

With the growth of vertical integration among physician practices (i.e., hospital–physician integration), there have been many studies of its effects on health care treatments and spending. It is unknown if integration shapes provider configurations, especially against the backdrop of increasing employment of nurse practitioners (NPs) and physician assistants (PAs) across specialties. Using a longitudinal panel of 144,289 practices (2008-2015), we examined the association of vertical integration with NP and PA employment. We find positive associations between vertical integration and newly employing NPs and PAs within physician practices; however, the relationships differ by practice specialty type as well as timing of vertical integration. Supplementary analyses offer supporting evidence for coinciding enhancements to practice productivity, diversification, and provider task allocation. Our results suggest that vertical integration may promote interdisciplinary provider configurations, which has the potential to improve care delivery efficiency.